Posts Tagged ‘Tech Transfer’

Yesterday a panel of Judges (Lourie, Reyna and Wallach) in Voter Verified, Inc. v. Premier Election Solutions, Appeal nos. 2011-1559, 2012-1016 (Fed. Cir. November 5, 2012) expanded on the Fed. Cir.’s earlier decision In re Lister, 583 F.3d 1307 (Fed. Cir. 2009)(archived under “Prior Art”), which in turn cited In re Klopfenstein, 380 F.3d 1345 (Fed. Cir. 2004), to affirm a district court’s holding that a patent on “a self-verifying voting system” was obvious in view of an article (the “Benson article”) that had been posted on the “Risks Digest Website” well prior to the 102(b) bar date.

Noting that the “key inquiry is whether the reference was made ‘sufficiently available to the public interested in the art’ before the critical date”, Klopfenstein was quoted as establishing that “Whether a reference is publicly available is determined on a case-by-case basis based on the facts and circumstances surrounding the reference’s disclosure to member of the public.”

Last summer, Bob Litan and Lesa Mitchell of the Kauffman Foundation sent a short memo to Esther Lee at the Dept. of Commerce entitled “Accelerating the Commercialization of Government-Funded University-Based Research.” Although the Foundation, based in Kansas City MO, has been interested in university tech transfer at least since 2003 when it issued a report “Accelerating Technology Transfer & Commercialization in the Life & Health Sciences” (PDF at end of posting), this memo attracted little attention until, in December, The Harvard Business Review named it as containing one of the “Ten Breakthrough Ideas for 2010.” The alleged breakthrough is the proposal in the memo that, while universities will continue to own inventions made with Federal funding, professors should be free to not use their university’s technology transfer office (TTO), but to have the option of licensing their inventions through whatever agency they prefer. The Kauffman premise, to put it bluntly, is that most TTOs are “suboptimal” and that professors would be better off, in many cases, shopping their technology to faster-moving licensing entities (of some sort). The stated goal is to speed up the commercialization of new technologies while allowing universities to collect the same royalties as under the current system.

So the Kauffman team feels that there are lots of professors with under-appreciated technologies who would benefit by being able to leave the corral of their institution’s TTO and ride off, if not into the sunset, into the arms of a third-party licensing entity who would make the translational connection needed to get the technology “from bench to bedside.” Really?

To begin with, it is difficult to see how this would work in practice. The Kauffman memo suggests that the professor might have the option to prevent the TTO from even trying to license the technology while he or she shops it. Or will we now have dueling TTOs trying to license the same technology? (The memo suggests that a professor with an automotive invention who lives in, say, Kansas might want to use a TTO in Detroit.) And what will prevent third-parties from taking most of the licensing royalties? The memo mentions ownership, but it does not seem to consider who will pay for the patent costs, especially if a statutory bar date looms. A system in which the professor’s TTO is paying the patent costs while the professor is out trying to license the IP portfolio via a different organization is difficult to imagine. And about conflicts of interest….

The Kauffman fellows seem to have no sense of the chaotic history of tech transfer prior to Bayh-Dole (BD) (or in its early years). When I was doing patent prosecution at a big IP firm, one client I was given was a professor from a prestigious university that did not have a tech transfer policy. Since he was free to do what he wanted with his new method of cancer treatment pre-BD, he had paid the firm to file applications on it, and eventually licensed them to big pharma for a lot of money (in those days). The university got nothing at all. The first talk I ever gave was about the BD Act and the audience was professors, not administrators.

Also, there were a number of “for-profit non-profit” entities gathering up loose technologies from universities without technology policies (let alone TTOs). Research Corp. Technologies (RCT) was one of the most successful. RCT would not take on a technology unless it could get an assignment (not a license) from the inventor(s) and institution(s) in question (if the university even asserted any ownership rights). RCT would then front all the patent costs and attempt to license the technology. If it was successful, the inventor(s), and sometimes the institution (if it cared), would get some of the royalties. Before the rise of TTOs that developed their own licensing expertise, RCT and other organizations like it scored some major tech transfer homeruns, but they could only handle so many proposals at once. BD has been referred to as an “unfunded mandate,” but it did motivate universities and other institutions getting NIH and other Federal funding to step up to the plate and swing, at least at the fat pitches.

There are still a few lone wolves out there trying to make it as “hired guns” (pardon the metaphors). Believe it or not, I am still approached by small companies that want to file on inventions brought to them by university professors who are either unaware that their universities have TTOs (or at least tech transfer policies) or think they can ignore them. They can’t. The present system is not “optimal,” but at least it is organized. A few years ago, a prominent researcher told me that his colleagues used to look down on him because he was patenting his discoveries and licensing them (often to start-ups). He was using a TTO, incidentally. He said that today it is the professors who are not patenting and licensing who are considered to be out of step. I don’t believe that there are hoards of break-through technologies languishing in dusty lab notebooks in academe and, if there are, I don’t believe that loosing professors trained in life sciences to bring them to market is going to change anything for the better.

Yesterday and today, the Minneapolis StarTribune has run lengthy stories contrasting the development of the biotechnology industry in Wisconsin with that in Minnesota. Today’s story focuses on the Wisconsin Alumni Research Foundation (WARF) and its successful efforts to found and promote life science start-ups based on technology developed at the University of Wisconsin.

While today’s article notes that WARF was founded in 1925, in my opinion, it could have given a better sense of just how long WARF has been contributing to the “state of the art” of bioscience in Wisconsin, and points beyond. For example, when I got to the office today, I opened my 1973 edition of “Choate on Patents,” the hornbook I used in law school in 1980. Two cases from the early 1940’s were abstracted involving the Steenbock process for enriching milk in vitamin D by irradiating it with UV light. This process was developed at the University of Wisconsin at about the time my father was a graduate student there, and WARF was already there to obtain the patents and to enforce them. Among other “home runs” in the late 1940’s and 50’s, WARF was involved in commercializing Warfarin (Coumadin), a “blood thinner” still widely in use, and in backing Professor Hector DeLuca’s successful effort to develop vitamin D metabolites and analogs in the sixties. Today WARF occupies one of the biggest buildings on campus and has revenue from investments in many aspects of Wisconsin’s economy.

A WARF fellowship to a young professor in the Department of Medicinal Chemistry made it possible for him to hire me as his first postdoctoral fellow in 1971. When a colleague, Professor Charles Sih, developed a practical synthesis of prostaglandins, he patented it through WARF, who licensed the patents to Miles Laboratories. Miles in turn opened a Natural Products Laboratory in Madison (renting space from a WARF subsidiary) and Prof. Sih hired me as the first Research Chemist for the lab in 1972. Miles employed about 15 people in the lab by the late 70’s and, believe me, in a town where Ph.D.’s drive cabs, these were “good-paying jobs.”

In contrast, the University of Minnesota did not have a “modern” tech transfer office until the mid-1980’s when it hired three patent attorneys, and began to do the missionary work necessary to attract disclosures of promising inventions from the faculty. To give you an idea of how little patenting the University of Minnesota had been doing prior to that time, Merchant & Gould, where I was then an associate, had only opened about thirty matters for the University of Minnesota in the entire history of the firm. The first patent application I filed for the University of Minnesota was in June of 1984 (U.S. Pat. No. 4,713,340), “Biodegradation of Pentachlorophenol.” (The Chakrabarty patent had only issued three years earlier, but life sciences patenting at the University was underway.) I was also fortunate enough to obtain the first of a series of patents for Professor Robert Vince that covers the anti-HIV drug Abacavir, which is marketed by Glaxo, and has yielded more licensing revenue over the years than almost any other invention patented at any university. Still, given what is essentially a sixty year head start, it is unrealistic to expect the University of Minnesota to somehow “catch up” to WARF. Our Office of Technology Transfer needs to be user-friendly, opportunistic and ready to set the hook and start reeling when the next big one strikes.